Role of Micro Entrepreneurship

in uplifting Rural India

Course : Rural marketing

Submission by : Group 5

Chaitanya (07), Deepak (19), Piyush(34), Prateek (37),

What are Micro-Enterprises Need of Micro-Enterprises
• Starting with Low-Cost
• Employment to Masses (Part/Full Time)
• It also called Micro-Business
• Initial Low Risk
• Less than 10 employees
• Reduce burden on Government to provide
• Capital less than Rs.25,00,000 employment
• Rely on Micro-Loans
• Lot of emerging sector under SMEs.
Schemes of Government
• Prime minister employment generation
Programme.
• Promotion of Innovation, Rural Industry
and Entrepreneurship.
• Scheme of Funds for generation of
Traditional Industries.
• Credit linked Capital subsidy Schemes.
• Coir Udyami Yojna
• Credit guarantee fund scheme.
Potential Micro Entrepreneurship Businesses in rural India

End mile connectivity in Rural Areas

Innovations by Start-ups like Ola/Uber
Government schemes and subsidies to local residents on buying commercial vehicles

Minimum usage of recourses with adequate trainings

Professionals like plumber, electricians, beauticians etc.
Innovations and connectivity by Start-ups like Urban-Clap, Urban-Pro

Vast Coastal areas of India

Government schemes (Micro-Financing) to provide latest equipment
Launching of Innovative mobile applications- Fisher Friend
Potential Micro Entrepreneurship Businesses in rural India

Harvesting of Honey from Forests

Women from house are engaged in the business
Majority used in medicines across the globe
Minimal initial investment

Natural recourse from Coconut available in Abundance

Great demand across the globe
Minimal initial setup of Coir Unit

Local people engaged in the business

Huge untapped potential available
Government schemes and training to local residents
Innovations and connectivity by organizations such as Air-Bnb, MMT etc.
Microfinance
• Any activity that includes the provision of financial
services such as credit, savings, and insurance to low-
income individuals with an aim of creating social value.

• The creation of social value includes poverty alleviation

and the broader impact of improving livelihood
opportunities through the provision of capital.

• A large variety of actors / institutions provide

microfinance in India, using a range of microfinance
delivery methods.
Microfinance-Salient features
• Since the founding of the Grameen Bank in Bangladesh, various actors have endeavoured to provide access to financial
services to the poor in creative ways.

• Governments piloted national programs, NGOs activity of raising donor funds for on-lending, and some banks have
partnered with public

• Range of activities include group lending, individual lending, the provision of savings and insurance, capacity building,
and agri business development services.

• Provision of financial services to low-income clients and the self-employed, who traditionally lack access to banking and
related services.

• Critics often attack microcredit while referring to it indiscriminately as either 'microcredit' or 'microfinance'. Due to the
broad range of microfinance services, it is difficult to assess impact, and very few studies have tried to assess its full
impact.
Microfinance-Various Forms
• Microcredit: Small amount of money loaned to a client by a
bank or other institution.

• Micro savings: Deposit services that allow one to save small

amounts of money for future use.

• Micro insurance: It is a system by which people, businesses

and other organizations make a payment to share risk.

Remittances: Compared with other sources of capital that can

fluctuate depending on the political or economic climate,
remittances are a relatively steady source of funds.
Microfinance-changing the face of poor India
• Micro-Finance is emerging as a powerful instrument for
poverty alleviation in the new economy. In India, micro-
Finance scene is dominated by Self Help Groups (SHGs) - Banks
linkage Program, aimed at providing a cost-effective
mechanism for providing financial services to the 'unreached
poor’.

• In the rural Indian context terms like "small and marginal

farmers", " rural artisans" and "economically weaker sections"
have been used to broadly define micro- finance customers.

• Research across the globe has shown that, over time,

microfinance clients increase their income and assets,
increase the number of years of schooling their children
receive, and improve the health and nutrition of their families.
 Microfinance-sources
Self Help Groups: SHGs play today a major role in poverty
alleviation in rural India. A growing number of poor people
(mostly women) in various parts of India are members of
SHGs and actively engage in savings and credit (S/C), as well
as in other activities (income generation, natural resources
management, literacy, child care and nutrition, etc.).

The S/C focus in the SHG is the most prominent element

and offers a chance to create some control over capital,
albeit in very small amounts..

Bank Partnership Model: Bank is the lender and the MFI

acts as an agent for handling items of work relating to credit
monitoring, supervision and recovery. The model has the
potential to significantly increase the amount of funding
that MFIs can leverage on a relatively small equity base.
Sub - variation of this model MFI, as an NBFC, holds the
individual loans on its books for a while before securitizing
them and selling them to the bank. Such refinancing
through securitization enables the MFI enlarged funding
access.
Microfinance-Institutions

Bengal & Jharkhand Odisha & Chhattisgarh

Bengal 4800 Cr 4000 Cr
9100 Cr

Tamil Nadu & AP

3200 Cr Gujarat & Rajasthan
2000 Cr

Karnataka
1400 Cr
Microfinance-Obstacles

Poor regulation and supervision of deposit-taking MFIs

Inappropriate donor subsidies

Few MFIs that meet the needs for savings, remittances or insurance

Institutional inefficiencies

Need for more dissemination and adoption of rural, agricultural microfinance methodologies

Limited management capacity in MFIs

Microfinance-Strategies to scale it up

SHG-Bank Linkage.

Clear targeting of clients

Appropriate products and services and good staffing

Overcoming geographic concentration in microfinance

Marketing of below Microfinance Products

Micro Entrepreneurship | Artisans of Rural India
Artisans of Rural India

INDIA is home to diversified communities possessing unique

characteristics of skill and art

A Rural Artisan is defined as a person making more than 50% of his/her

income from village crafts like handloom, carpentry, black smithing etc.

True protectors of this wealth who are possessed with superior skills and
blessed with intrinsic art.

Artisan sector constitutes of over 70 Lakh rural artisans such as potters,

carpenters, weavers, stone workers, carpet and wood carving, jewelry
making, Tailors, Zari workers etc. Sector is the biggest employer in the
country after the agricultural sector spread across 85% of Indian states.

Majority of these artisans’ communities belong to underprivileged

groups, which are on very meagre supply of resources
Artisans | Challenges Faced
• Industrialized handicrafts and artefacts over handmade
handicrafts, matching quality and demand level

• Viability of Handmade products; rising raw material costs,

shifting of consumers to cheap substitutes, better feature
rich alternative raw materials, rising layers of intermediaries
etc.

• Inadequate positioning and expansion platforms; artisans

often face shortcoming of being in rural pocket of India

• Lack of Education and awareness to use life supporting

elements of the new era such as smartphones, internet,
productivity tools, selling forums, government schemes etc.

• Caste based discrimination and restriction of Artisanal Skills

and Labour
Rural Entrepreneurship | Rescuer to Artisanal Sector
 Spreading Awareness about products and its creation; giving a selling Image for
the artisans

 Encouraging association of rural youth and new generations; making it viable to

help them stay with the pride of the community.

 Arranging right resources for the art and the artists; Time to time training and up
skilling, exposing the artisans to the sales and customer facing forums, monetary
and technological support to combat automated production houses.

 Connecting through government schemes, acts as an extended arm for the

benefits to reach the artisans and community

Working on 4 key pillars of rural marketing – Affordability, Acceptability, Availability

and Accessibility
Dastkar is a private NGO not for profit organization,
which has formed community with more than 1 lakh
craftspeople across 25 states of country.
Dastkar Ranthambore, Berozgar Mahila Kalyan
Sanstha, Kala Raksha, etc. are such projects
undertaken by organization which have empowered
many artisans and craft tribes, improving the
livelihood completely.
Established in Maheshwar, MP in 2002, with vision to
help women in living fulfilling and dignified life
WW offers right training, ecosystem and opportunities for
progressive positioning and upselling of product,
maximizing their livelihood
Events including Melas, Haats, fashion weeks, Jaipur
Literary festival, etc. were organized time to time to
encourage weavers.
The Handloom School Gudi Mudi Khadi
Recommendation | Strengthening role of Entrepreneurship and Artisanal Sector

 Continued Awareness and importance of Skill and Art

 Transparency and Rolling down of Benefits of Govt. Policies and initiatives
 Accessibility to Financial institutions and collateral free financing
 Ensuring Environment and Human Friendly Working Ecosystem
 Introducing art and skill to more rural inhabitants.
 Spreading Artisan Identity Card scheme and strengthening implementation
 Collaborations with Institutions across value chain – From Designer houses to Retailers
 Instilling Equilibrium between Conventional workmanship and technological advancements, preserving originality and
aesthetics
 Community Influenced Unique Branding and positioning.
Eg Geographic identification number granted to artisans of Tangaliya
 Contract Production of Handicrafts
 Online marketing of Handicraft products & culture.
Eg Rural Bazaar web store, crafts of Gujarat, Garvi Gurjari, Mahila E Haat etc.
 • Micro-entrepreneurship can be developed as one of the significant ways
Future Scope of of strengthening a developing economy, which promises to generate
income and employment and alleviates the burden on the government.

Micro • Collaboration between the government and the key players in the
industry is essential to facilitate and generate new opportunities for

Entrepreneurship micro-entrepreneurship.
• Several existing central and state schemes can be harnessed to facilitate

in India the availability of financial resources for micro-enterprises, reduce the

burden of taxation and provide training and infrastructure for their
sustenance
• Technology plays an important role in making micro-entrepreneurship
cost-effective and profitable and governments can focus on the
development of sector specific technology to support microenterprises.
• Transport, service and manufacturing sectors are key areas that show
immense scope for collaboration and development of micro-
enterprises.
• Agriculture and allied sectors are also potential areas, which can be
encouraged by Governments by providing adequate incentives, for
micro-entrepreneurship.
 • Make in India Initiative
Future Scope of
• Digital India
Micro • Export contribution
Entrepreneurship • Public procurement policy
in India • Procurement by large Indian and foreign
corporate across industry sectors from
Micro-Entrepreneur’s
• Indigenisation
• Traditional and heritage industries
 • Infrastructure
Future Scope of
• Regulatory
Micro • Funding
Entrepreneurship • Performance incentives
in India • Skill India
Thank you !